A narrow focus on workplace reform prevents us from tackling other important elements of productivity, such as energy and carbon, that are increasingly relevant to 21st-century economies.
Maximising the value we extract from both energy and carbon will be central to Australia's prosperity as the world deals with tightening resource constraints and the intensifying effects of climate change. We cannot avoid the disruptive effects of fuel costs, carbon limits and new technologies, but we can prepare to avoid the worst impacts, and - ideally - profit from them.

Similarly, we cannot avoid the economic, environmental and social consequences of carbon emissions, but we can ready ourselves to be resilient.

Carbon productivity - the value we create for each tonne of greenhouse gas emitted - depends broadly on two factors: the efficiency of energy use and the carbon intensity of that energy.

Giving some much needed policy stability to the clean energy and energy services sectors is critical to sustain new industries and the viability of traditional industries. Most important, we must not flinch in our determination to move to a low carbon economy, given the social, economic and environmental risks at stake.

We believe a national target to boost energy productivity by 30 per cent by 2020 sets a strong framework for energy efficiency improvements across the economy. To reach this target, we recommend expanding state-based energy saving obligations into a national initiative, mandatory efficiency standards and landlord incentives to improve rental properties, and assistance to address acute financial barriers that prevent low-income people investing in efficiency.

Our present energy market settings are focused on investing more in poles and wires rather than reducing demand. This is out of step with the surge in industrial energy efficiency and a decline in household electricity consumption. In a future of resource constraints and carbon limits, alignment of these systems is critical to deliver savings to consumers.

Meanwhile, the people least able to access these investments are those who need it most. For people living on low incomes in poor quality housing, simple building and appliance improvements can make a big difference. A whole host of social objectives, including reductions in energy hardship and reduced health and mortality risks, can be met by squeezing more value from energy bills.

The carbon intensity of our energy use is trending down, but we risk undermining this success. The Renewable Energy Target is an example of bipartisan policy success, but its contribution is threatened by uncertainty and opportunistic attacks.

Likewise, with the existing carbon pricing mechanism and complementary measures, Australia can achieve its bipartisan commitment to cut our emissions - but not without a price and limit on carbon.

With federally funded programs such as the Clean Technology Investment Program always at risk of budget cuts, support for driving improvements in domestic carbon productivity is undermined. Australia can't sustainably contribute to the global effort without reorienting our economy to an energy efficient, low-carbon base. Policy reversals and short-term fixes make the transition more expensive.

Giving some much needed policy stability to the clean energy and energy services sectors is critical to sustain new industries and the viability of traditional industries. Most important, we must not flinch in our determination to move to a low carbon economy, given the social, economic and environmental risks at stake.
Ged Kearney is ACTU president. Cassandra Goldie is chief executive of the Australian Council of Social Service. Don Henry is chief executive of the Australian Conservation Foundation. John Connor is chief executive of the Climate Institute.

John Connor

John Connor was CEO of The Climate Institute from 2007 to March 2017. Whilst qualified as a lawyer, John has spent over twenty years working in a variety of policy and advocacy roles with organisations including World Vision, Make Poverty History, the Australian Conservation Foundation and the NSW Nature Conservation Council. Since joining The Climate Institute in 2007 John has been a leading analyst and commentator on the rollercoaster that has been Australia’s domestic and international carbon policy and overseen the Institute’s additional focus on institutional investors and climate risk. John has also worked on numerous government and business advisory panels.